http://www.legislation.gov.uk/id/uksi/1996/1462

http://www.legislation.gov.uk/uksi/1996/1462/part/I/2014-03-13

The Contracting-out (Transfer and Transfer Payment) Regulations 1996

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Statute Law Database

PENSIONS

2022-02-21

Expert Participation

2014-03-13

These Regulations replace the Contracting-out (Transfer) Regulations 1985 which are now (subject to transitional provisions) revoked. The Regulations supplement changes introduced by the Pensions Act 1995 to Part III of the Pension Schemes Act 1993. They also consolidate and amend those provisions of the 1985 Regulations which remain relevant. The regulations made by virtue of section 12C of the 1993 Act as inserted by section 136 of the 1995 Act are made within six months of that provision coming into force and as a consequence there is no requirement to consult. As regards those regulations which are neither made only for the purpose of consolidation nor under the 1995 Act, the Occupational Pensions Board has agreed that proposals to make such regulations need not be referred to them.Part I of the Regulations contains general provisions relating to citation, commencement and interpretation.Part II of the Regulations makes provision for the circumstances in which and the conditions subject to which a transfer of or transfer payment in respect of an earner’s accrued rights to guaranteed minimum pensions (or the liability for the payment of guaranteed minimum pensions in respect of which entitlement has already arisen) may be made from one pension scheme to another or from an insurance policy or annuity contract to a pension scheme.Part III of the Regulations makes provision for the circumstances in which and the conditions subject to which a transfer of liability may be made from a pension scheme or from an insurance policy or annuity contract to a pension scheme or arrangement in respect of rights to pensions which have accrued on or after the principal appointed day under a scheme contracted-out by virtue of section 9(2B) of the 1993 Act.Part IV of the Regulations modifies Part III of the 1993 Act where a transfer or transfer payment has been made under Part I of the Regulations to a scheme which is contracted-out under section 9(2) of that Act (a salary-related contracted-out scheme) so as to ensure that the receiving scheme provides guaranteed minimum pensions in consequence of the transfer or transfer payment.Part V of the Regulations contains revocations and transitional provisions.An assessment of the compliance cost for employers of the measures arising from the Pensions Act 1995, including these Regulations, has been placed in the libraries of both Houses of Parliament. Copies can be obtained by post from the Department of Social Security, Private Pensions Directorate, 11th floor, The Adelphi, 1-11 John Adam Street, London, WC2N 6HT.

The Contracting-out (Transfer and Transfer Payment) Regulations 1996

Regulations

The Occupational Pension Schemes (Mixed Benefit Contracted-out Schemes) Regulations 1996

reg. 4

reg. 1(1)

PART I GENERAL

Citation, commencement and interpretation1

1

These Regulations may be cited as the Contracting-out (Transfer and Transfer Payment) Regulations 1996 and shall come into force on 6th April 1997.

2

In these Regulations—

“the 1993 Act" means the Pension Schemes Act 1993;

“accrued rights", for the purposes of Parts II and IV of these Regulations, has the meaning given to that expression in section 20(6) of the 1993 Act;

F8...

“appropriate policy" means a policy of insurance or an annuity contract such as is described in section 19(4) of the 1993 Act;

“appropriately secured" has the meaning given to that expression in section 19(3) of the 1993 Act;

F11“connected employer transfer” and “connected employer transfer payment” mean respectively a transfer of guaranteed minimum pensions from a salary-related contracted-out scheme to a salary-related contracted-out scheme and a transfer payment in respect of section 9(2B) rights from a salary-related contracted-out scheme to a salary-related contracted-out scheme where either—

a
the transferring scheme and the receiving scheme relate to persons who are or have been in employment with the same employer; or
b
the transferring scheme and receiving scheme relate to persons who are or have been in employment with different employers, and the earner or person concerned is one of a group of persons in respect of whom transfers or transfer payments are being made from the transferring scheme to the receiving scheme and either—
1. i
  the transfer or transfer payment is a consequence of a financial transaction between the employers, or
2. ii
  each of the employers is one of a group of companies consisting of a holding company and one or more subsidiaries within the meaning of section 1159(1) of the Companies Act 2006 (meaning of “subsidiary” etc ),

and, in this definition, “salary-related contracted-out scheme” includes a scheme which was formerly a salary-related contracted-out scheme;.

“earner" includes an earner who is not in employment at the time of the transfer or transfer payment;

F8...

“overseas arrangement" means a scheme or arrangement, other than an occupational pension scheme, which—

a

has effect, or is capable of having effect, so as to provide benefits on termination of employment or on death or retirement to or in respect of earners; F9and

F10b

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

c

is administered wholly or primarily outside the United Kingdom;

F3“overseas scheme” means—

a
an occupational pension scheme which has its main administration outside the F4EEA states ; or
b
a European pensions institution as defined in section 293(8) of the Pensions Act 2004 (functions of Regulator in relation to institutions administered in other F5EEA states ),

but does not include a salary-related contracted-out scheme nor one in respect of which section 53 of the 1993 Act applies by virtue of section 52(1) of that Act.

“the principal appointed day" has the meaning given to that expression in section 7(2B) of the 1993 Act M1;

F7...

“salary-related contracted-out scheme" means an occupational pension scheme which is contracted-out by virtue of satisfying section 9(2) of the 1993 Act M2;

“scheme" means an occupational pension scheme or a personal pension scheme;

F1“section 9(2B) rights" are—

a

rights to the payment of pensions and accrued rights to pensions (other than rights attributable to voluntary contributions) under a scheme contracted-out by virtue of section 9(2B) of the 1993 Act, so far as attributable to an earner’s service in contracted-out employment on or after the principal appointed day; and

b

where a transfer payment has been made to such a scheme, any rights arising under the scheme as a consequence of that payment which are derived directly or indirectly from—

i

such rights as are referred to in sub-paragraph (a) under another scheme contracted-out by virtue of section 9(2B) of that Act; or

ii

protected rights under another occupational pension scheme or under a personal pension scheme attributable to payments or contributions in respect of F2 ... employment on or after the principal appointed day F6where that transfer payment was made before the abolition date;

“trustees", in relation to a scheme which is not set up or established under a trust, means the managers of the scheme.